Markets trade above neutral line in late morning session

Key Indian benchmarks erased all of their losses and managed to trade above the neutral line in late morning session on the back of buying in Capital Goods, Realty and Consumer Durables stocks. Traders took support with Union Minister of State for Water Resources Arjun Ram Meghwal’s statement that the agriculture sector's contribution to the country's GDP has increased under the present government's rule. Adding some optimism, the global president of the Association of Chartered Certified Accountants (ACCA), Brian McEnery has said that India has made significant strides towards ethical standards in business and enforcing provisions around corporate governance. However, upside remained capped with the Moody's latest report stating that India is the only G20 emerging market country where growth has slowed sharply for six consecutive quarters. But it expects economic growth in 2017 to average 6.2% before accelerating to around 7.5% in 2018 and 2019. Some concerns also came with report that India’s retail inflation is forecast to have sped up to a seven-month high in October, led by a rebound in food prices as unexpected rains destroyed crops.

On the global front, Asian markets were trading mostly in red on concerns over US tax reform as a tax reform plan unveiled by Senate Republicans has several key differences with the House of Representatives' version, including a delay in implementation of the corporate tax rate cut. Back home, in scrip specific development, Bharti Airtel was trading higher after the company entered into a strategic partnership with software solutions provider Amdocs to bring Artificial Intelligence (AI)-based services to its customers in India. By leveraging its innovation centres, delivery expertise and its ecosystem of startups, Amdocs will deploy machine learning and advanced AI-based technologies across Airtel’s businesses.

The BSE Sensex is currently trading at 33263.25, up by 12.32 points or 0.04% after trading in a range of 33135.94 and 33280.55. There were 12 stocks advancing against 18 stocks declining on the index, while 1 stock remained unchanged.

The broader indices were trading in green; the BSE Mid cap index was up by 0.24%, while Small cap index was up by 0.55%.

The top gaining sectoral indices on the BSE were Capital Goods up by 2.54%, Realty up by 1.73%, Consumer Durables up by 0.87%, Industrials up by 0.80% and FMCG up by 0.70%, while Energy down by 0.99%, Auto down by 0.67%, Healthcare down by 0.48%, Metal down by 0.38% and IT down by 0.31% were the top losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 3.44%, ITC up by 1.42%, ICICI Bank up by 1.32%, ONGC up by 1.06% and SBI up by 0.92%. On the flip side, Asian Paints down by 2.60%, Tata Motors down by 2.53%, Coal India down by 1.62%, Adani Ports & SEZ down by 1.42% and Reliance Industries down by 1.34% were the top losers.

Meanwhile, in line with mounting production capacities, the government emphasized the need to raise the demand for steel in India. Besides, Sunil Barthwal, Joint Secretary at the Indian Ministry of Steel, has pointed out that if the domestic demand is falling slightly short, so the issue is that the domestic demand has to be raised. He also noted that the production capacities in the country are growing at a very good pace and have grown by 6.7 percent in the calendar year up to September in the last nine months.

Asserting that India now has become a net exporter of steel amid weak domestic demand, Barthwal has said that the country’s steel products are being exported across the world, including advanced countries. He said “It is not just that we are selling (steel products) to Africa. We are selling it to the most advanced countries where they are competing with the best of the products.” He also noted that other than demand, the government's focus was to make Indian steel industries globally competitive.

Earlier, the government had said that there was a need to create steel demand in line with the planned increase in capacities. It had also said that creating demand for 300 million tonnes of steel -- the output target India is looking at by 2031, will be a big challenge. India’s per capita steel consumption at 61 kg is much lower than the global average of 208 kg.

The CNX Nifty is currently trading at 10309.00, up by 0.05 points after trading in a range of 10270.00 and 10315.40. There were 20 stocks advancing against 29 stocks declining on the index, while 1 stock remained unchanged.

The top gainers on Nifty were Larsen & Toubro up by 4.07%, Ultratech Cement up by 2.10%, GAIL India up by 1.64%, ITC up by 1.56% and Yes Bank up by 1.33%. On the flip side, Aurobindo Pharma down by 3.73%, Asian Paints down by 2.88%, Tata Motors down by 2.57%, BPCL down by 1.70% and Coal India down by 1.68% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 decreased 198.93 points or 0.87% to 22,669.78, Jakarta Composite decreased 15.99 points or 0.26% to 6,026.47, Taiwan Weighted decreased 7.76 points or 0.07% to 10,735.51, KOSPI Index decreased 6.16 points or 0.24% to 2,544.41 and FTSE Bursa Malaysia KLCI decreased 0.06 points or 0% to 1,746.75.

On the flip side, Shanghai Composite increased 1.06 points or 0.03% to 3,428.85 and Hang Seng increased 51.71 points or 0.18% to 29,188.28.